EUR/USD Mid-Session Technical Analysis for March 2, 2021The direction of the EUR/USD on Tuesday is likely to be determined by trader reaction to 1.2010.
The Euro is trading lower against the U.S. Dollar on Tuesday after the release of a report that showed Euro Zone inflation held steady as expected last month, taking a break in what is likely to be a temporary but sharp spike in consumer prices in the coming months.
Perhaps helping to put a lid on the Euro is chatter saying instead of tightening on higher inflation, the ECB may actually ease further, possibly as soon as its March 11 meeting, to counter a recent rise in nominal yields, which threatens to choke off growth by making borrowing more expensive.
Trading Derivatives carries a high level of risk to your capital and you should only trade with money you can afford to lose. Trading Derivatives may not be suitable for all investors, so please ensure that you fully understand the risks involved, and seek independent advice if necessary. A Product Disclosure Statement (PDS) can be obtained either from this website or on request from our offices and should be considered before entering into a transaction with us. Raw Spread accounts offer spreads from 0.0 pips with a commission charge of USD $3.50 per 100k traded. Standard account offer spreads from 1 pips with no additional commission charges. Spreads on CFD indices start at 0.4 points. The information on this site is not directed at residents in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
At 13:36 GMT, the EUR/USD is trading 1.2027, down 0.0022 or -0.18%.
“Headline inflation will almost certainly rise further in the coming months, to around 2% due to further rises in food and energy price inflation,” ABN Amro said in a note before the data release. “However, it will be very likely to a one off…leading to a sharp drop in inflation as the disinflationary pressures from the economic shock come to the fore.”
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart, however, momentum is trending lower. A trade through 1.2243 will signal a resumption of the uptrend. The main trend will change to down on a trade through 1.1952.
The minor trend is down. This is driving the momentum lower.
The EUR/USD is currently trading inside the main retracement zone at 1.2074 to 1.2010. This zone is controlling the near-term direction of the Forex pair.
The short-term range is 1.2349 to 1.1952. Its retracement zone at 1.2151 to 1.2197 is resistance, and a potential trigger point for an acceleration to the upside.
Daily Swing Chart Technical Forecast
The direction of the EUR/USD on Tuesday is likely to be determined by trader reaction to 1.2010.
A sustained move over 1.2010 will indicate the presence of buyers. This could trigger a rally into 1.2074. This is a potential trigger point for an acceleration to the upside with 1.2151 the next likely upside target.
A sustained move under 1.2010 will signal the presence of sellers. This could trigger an acceleration to the downside with 1.1952 the next likely downside target.
For a look at all of today’s economic events, check out our economic calendar.